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Professional Liability Coverage Scenarios for Accountants

February 23, 2023

CPAs and accounting professionals operate with the highest demands on their performance and accuracy — an expectation to get every detail right, every time. Unfortunately, despite attention to detail and careful calculations, allegations of negligence, errors and omissions in the performance of professional accounting services happen and can lead to claims or lawsuits.

  • Subpoena Costs: What would happen if a firm received a subpoena for a lawsuit in which it is not a named party?
    • Hanover’s subpoena assistance supplemental coverage will cover fees incurred for an attorney to provide advice regarding the production of documents, prepare the individual for sworn testimony and represent the individual at depositions.
  • Data Breach: How would a firm be affected if its network was violated by a hacker and its clients’ personally identifiable information was breached?
    • Hanover’s privacy and security liability coverage covers the firm for liability related to mishandling a client’s personal information, including a cyberattack on a firm’s system, actions of a rogue employee, violations of customer notification laws and more.
  • Reputational Risk: What would happen if a crisis event, such as the sudden passing of a firm’s principal, occurred?
    • Most firms do not have experience managing reputation in the face of crisis. Hanover’s crisis event supplemental coverage covers reasonable fees, costs and expenses incurred by the firm for consulting services performed by a crisis management firm because of a crisis event.
  • Dissatisfied Clients: What assistance is available to help a firm respond to an unhappy client in a way that may help prevent the issue from becoming a claim?
    • Most policies only cover expenses for actual claims. Hanover’s pre-claim assistance supplemental coverage helps the firm prevent difficult situations from becoming claims by covering the cost or defense expenses incurred in investigating or monitoring a potential claim when reported to us in writing.
  • Navigating Potential Claims Issues: How can Hanover help a firm navigate issues that could potentially turn into claims?
    • Hanover’s professional liability risk management hotline, staffed by lawyers and claim professionals, is a resource for discussing problems and questions that can arise about best practices and potential claims.
  • Scope-of-Service Disputes: Does Hanover offer any resources to help avoid misunderstandings and disputes over agreements?
    • Hanover’s online portal---www.hanoverprorisk.com--features a variety of sample engagement letters and contracts built specifically for CPAs and accountants.
  • Claims Not Being Handled Expeditiously: How confident can I be that my claim will be handled quickly?
    • Reporting claims to Hanover is fast and simple. Hanover offers 24-hour access to claims reporting to provide support as soon as a claim arises. Plus, they have a special claims unit dedicated exclusively to resolving professional liability claims in a fast, fair and professional manner.
  • Claims Being Mishandled: How confident can I be that claims staff understands the complexities of claims?
    • Hanover’s claims professionals are highly skilled at mitigating and litigating traditional and emerging risks. All team members are attorneys by training and have, on average, over 20 years of litigation and claims experience.

Does your current policy cover each scenario listed? For a review and a quote, contact Chris Hays at 3000 Insurance Group.

Chris Hays, Director of Association Business
Christopher@3000ig.com
405.507.5305